Imagining the next iteration of paid TV

16-24 year olds watch substantially less TV (50% of watching activities vs 69% for all adults) and more YouTube (8% of watching activities vs 2% for all adults) – see this Tweet from Benedict Evans

That got me wondering what these young YouTubers will watch as they grow older.

Assuming they are going to want to watch premium content like Breaking Bad, and most won’t want to use BitTorrent for the rest of their lives they will have to start paying. The question is what they are going to buy, and I can’t see them going from paying nothing to paying £5.99 a month for a Netflix account, or worse, £29.99 for Sky.

Jim Barksdale, founder of Netscape famously said that “there are only two ways to make money in business: bundling and unbundling”. We’ve seen this a lot in media – iTunes unbundled the album into singles and now Spotify have bundled singles up into an all you can eat subscription.

With TV programmes the major story has been Netflix taking market share from cable and satellite TV companies but that has been substituting one bundle for another rather than unbundling, albeit in an on-demand rather than channel format. I suspect in future we will see a proper unbundling with more market share moving pay per view services. Like iTunes, except with discovery built in. And a UX that doesn’t make me want to scream.

I think there’s a opportunity to build a startup that aggregates the content, makes recommendations, and handles payments, taking a cut on the way. A bit like our portfolio company Thread.com, but for TV. The challenge with this will be timing the startup to coincide with when the content becomes available to aggregate.